ACA Marketplace and Employer Health Plan Cost Comparison
Are you ready for 2016 Individual Open Enrollment? The #1 question we get form individuals is am I better off staying on the individual plan or joining my small employer group plan?
Starting Nov 1, 2015, the 3rd anniversary of Obamacare’s ACA Marketplace begins. Continuing through 2018, several new parts of the Affordable Care Act that affect costs and benefits will be rolled out. The remaining provisions will take effect against a backdrop of new patterns in health care spending and trends.
A frequent Employer question is how do costs compare on the ACA Marektplace vs. Employer Health Plans. The infographic from the Commonwealth Fund point out that the premiums are more favorable when factoring low income premium subsidies. In order to even the scales, an individual must earn $23,500 for a net subsidized premium of $125/month (click Kaiser calculator). This number represents 60% of marketplace enrollees. The same $125/month contribution amount represents 55% of employer health plans.
One positive point is that U.S. health care spending has slowed in the past few years. In a recent 16-month period, nearly 23 million Americans have enrolled in the Affordable Care Act, while almost 6 million people lost coverage. Research from Rand Corp. finds that of the newly insured:
- 42 percent are covered through employer-sponsored plans.
- 29 percent are enrolled in Medicaid.
- 18 percent have health coverage in individual marketplaces.
Take a look at the infographic:
2016 Open Enrollment Deadlines:
- November 1, 2015: Open Enrollment starts — first day you can enroll in a 2016 insurance plan through the Health Insurance Marketplace. Coverage can start as soon as January 1, 2016.
FYI2016 plans and prices will be available for preview the third week of October, 2015.
- December 15, 2015: Last day to enroll in or change plans for new coverage to start January 1, 2016.
- January 1, 2016: 2016 coverage starts for those who enroll or change plans by December 15.
- January 15, 2016: Last day to enroll in or change plans for new coverage to start February 1, 2016
- January 31, 2016: 2016 Open Enrollment ends. Enrollments or changes between January 16 and January 31 take effect March 1, 2016.
If you don’t enroll in a 2016 health insurance plan by January 31, 2016, you can’t enroll in a health insurance plan for 2016 unless you qualify for a Marketplace Special Enrollment Period.
Penalty: The uninsured penalty rises to $695 or 2.5% of your income, whichever is higher.
Coverage start dates
If you enroll before the 15th of any month, your coverage starts the first day of the next month. If you enroll after the 15th of the month, you’ll have to wait until the month after that for your coverage to start. So, for example, if you enroll on January 16, your coverage would start on March 1.